I bought Femi Pedro’s The Formula for Wealth, My thoughts on Wealth, Entrepreneurship and Leadership because of his background as a co-founder of Guaranty Trust Bank (GTB), former deputy governor of Lagos State and current chairman of the Small and Medium Enterprises Development Agency of Nigeria. I had hoped the book will teach the reader how to create wealth with particular emphasis on what opportunities currently exist for creating businesses in various sectors in Nigeria.
The book delivered for the most part. Pedro’s story about his own humble beginning will inspire the reader. His insights on real estate investment, equity ownership, starting a company etc. are quite thorough. The many nuggets of wisdom in the book sprinkled with quotes from notable people and self-help authors serve to remind the reader that the path to success is attainable with diligence, persistence and patience.
I loved Pedro’s use of anecdotes to buttress his points. There was the story of Nnamdi Ezeigbo, an electrical engineer who in the 1990’s having failed to secure a job in a multinational company, started repairing computers. Subsequently Ezeigbo started importing computer parts and strategically grew and positioned his business that when GSM was eventually introduced in Nigeria, he partnered with MTN to sell sim cards, recharge cards and phones. Later, identifying the need, he started importing unlocked and dual sim phones directly from China. Today Ezeigbo has built enormous wealth. He worked hard and when the opportunity presented itself, took advantage of it to the fullest. His story shows that chance only favors the prepared and that starting wherever we can, with the little we have, often leads to greater success.
In the book, Pedro also distinguished between the rich, who merely buy expensive cars, houses, etc., and the wealthy, who invest in real estate, equities etc. Pedro also explained that should the rich fail to invest, the money soon vanishes and they become poor where as a person becomes wealthy when they own enough investment to be financially independent without working. Pedro also pointed out that wealth can be only be created through entrepreneurship and not by being employed.
Pedro illustrated how high salary earners can end up in the poverty trap if they fail to build wealth and how relying on one’s salary as the sole source of income is never a good idea. He told the story of four successful Nigerian bankers who were affected by the bank consolidation in the 2000’s and how of the four, only the frugal one who saved for the rainy day and started his own company survived financially when they all lost their jobs.
In the book, Pedro also posited that if you love what you do and the thought of your business gets your juices flowing, you are more likely to succeed. Pedro encourages everyone to save, irrespective of their income level, as money not saved is often used for non-essential things one may not be able to account for.
Pedro also wrote about a survey he commissioned that shows 85% of Nigerian entrepreneurs are struggling financially but also gave examples of young successful Nigerian entrepreneurs who are making it despite the odds like the founders of Jobberman, Bellanaija, Jumai and Konga. He highlighted what they were doing differently that accounts for their success.
Pedro’s book contains numerous valuable advice on how to build wealth including one about how one’s first real estate purchase should be for investment purposes, not to live in.
While I had hoped Pedro wrote more about his work in public service (for example, how he was able to , as deputy governor of Lagos State and chairman of Lagos State Revenue Mobilization committee, increase Lagos State internally generated revenue from from 300 Million Naira per month to a whopping 7 Billion Naira per month in the space of eighteen months) including his current role at Small and Medium Enterprises Development Agency of Nigeria, and given more insight into what sectors are currently economically viable for investment in Nigeria for small and medium enterprises, overall, I think the book is a good read that will encourage the reader to aspire to do more, be more and build wealth. I recommend this book to anyone looking to build wealth especially in Nigeria. You can buy the book in paperback or hardcover here, or get the ecopy on kindle for less than $4. It’s definitely a worthwhile investment.
For curious readers who may want to know the answer to the question I had hoped Pedro answered, it will appear that in this decade, any business that leverages the power of information technology is more likely to succeed. One can see, for example, that the contemporary Nigerian businesses listed by Pedro as successful are mostly technology or online based companies. In that regard, J. J. Omujuwa’s book, Digital: The New Code of Wealth: New Opportunities for Wealth Creation and Change which I read some months ago does offer insights into how to leverage the power of the internet to create wealth.
I do hope you consider reading one or both books to better understand the unique challenges and triumph of building businesses and creating wealth in Nigeria.
Updated June 8, 2020.